Wheat Soars on Strong Demand

Wheat futures soared on Tuesday due to strong demands caused by a positive US weekly exports report and China Covid policy curbs.

The US wheat futures for March delivery rose by 0.11% to $739.60 per metric ton on December 06.

This increase came following the report from the US Department of Agriculture regarding the 334,653.00 tons of wheat contract.

Amid all of this, expectations for China’s Covid policy curbs fuel the demand for US commodities.

On the flip side, ample supplies may hinder the commodity’s price.

Meanwhile, prices of Russian wheat exports fell last week due to record harvest and reserve from the Black Sea.

Moreover, its farmers’ 17.70 million hectares of winter crops came short of the 18.40 million hectares a year prior.

Similarly, Ukrainian wheat was lower by 20.00% in the period between October and November.

According to the data from Ukrainian Grain Association, the country’s total exports were down by 29.90% compared to a year before.

In the meantime, Pakistan continues to buy massive amounts of wheat.

On Monday, its finance ministry announced an agreement to buy 450,000.00 tons of wheat from Russia.

This move came after the country experienced devastating floods that damaged the crops in July and August.

Australia Wheat Harvest Jumps

One of the world’s biggest wheat exporters, Australia, is set to harvest a record amount this season despite the heavy rains.

The country’s crops are expected to jump by 14.00% to 36.6 million tons in 2022-2023.

Furthermore, its wheat export price is anticipated to increase by 11.00% to $546.00 per ton in the same season.

However, this prediction would not spread evenly in the country due to extensive flooding.

Additionally, experts forecast that the issue will result in a 16.00% crop abandonment in the eastern states.

On top of that, the supply pressure could linger as replenishing the inventories would take a while.